Well this is the thing, i created a file using the mail function that just sends out an email to me, nothing fancy at all. If i run it from the command prompt as the user Litespeed is run as, it works just fine. I can see the email enter my qmail queue and then it goes out.

When i use the same file as a web request, the email enters my mail queue but never gets sent out.

The only difference is that i am triggering it using LSAPI rather than on the command prompt.

My PHP is compiled by me and both the CLI and LSAPI have the same exact configure setting with the exception of "--with-litespeed".

I think there might be something in php.ini prevent the mail function work properly. You can try CLI or LSAPI PHP from comand line using option "-c <path_to_php.ini>", see if you get the same result as run under LSWS.

For LSWS configuration, please double check process soft/hard limit and memory limit, make sure they are large enough.

those numbers are looking fine.
Maybe you need to set "sendmail_path" in php.ini
details are in http://us3.php.net/mail
LSWS will not pass your shell PATH environment to PHP started by it, instead, it set PATH to "/usr/bin:/bin", so a wrong "sendmail" might be used. you can set PATH in environment explicitly as well.